Monthly Archives: January 2010

It’s Time GPPSS Moved Forward With No-Fee All Day Kindergarten

A loophole in how Michigan distributes per pupil revenue has long allowed public schools to get twice what they really deserved for half-day kindergarten students.  But charging for extended day kindergarten amounts to taxing residents twice.  For this and other reasons I am advocating a district-wide switch to a no-fee All Day Kindergarten program for 2010-11.

In my last post and at the Board of Education meeting on January 25th I spent a great deal of time emphasizing that Michigan public schools derive their revenue on a per pupil basis.  The per pupil funding is known as the Foundation Allowance.  The Foundation Allowance does not distinguish between between a half-day student and a regular, full-day student.  This has been a pretty good deal for school districts.

Why?  Simple.  If we receive full per pupil funding for half-day kindergarten students it means that we essentially educate them at half the cost of most of our other students.  This is good for the district and, arguably, the other district services subsidized by the business model.

But it’s not so good if you are among the ever growing group of families who prefer their son or daughter go for more than half a day of kindergarten.  In response to this demand school districts have created programs called Extended Day Kindergarten (EDK).  But many districts, including GPPSS, charge a fee for EDK.

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Filed under Current Events, GPPS Academics, GPPS Budget Decisions, GPPS Policy, Meeting or Agenda Announcement

2010-11 GPPSS Budget Development: Background, Process and Timeline

The 2010-11 Grosse Pointe Public School System budget will present perhaps the most difficult challenge to the district in its history.  Approaching such a problem with stakes as high as they are will require careful planning, collaboration, and deliberation.  Above all else, it requires an understanding of the dynamics that contribute to the current economic distress.

Last night’s Board of Education meeting was the first official Regular Meeting of the Board of Education of 2010.  I am honered to have been voted by my peers to serve in the role of treasurer, but at the same time I know that the task and responsibility of the position could not be any greater than they are right now.

Having spent the last 4 and a half years on the school board, and over a year before that, educating myself on the economic factors at play for our district and all those across the state of Michigan, I approach this daunting task with a great deal of confidence and resolve.  The trite phrase is “Knowledge is Power,” but knowledge is impotent if not leveraged.  The more people who have knowledge and choose to leverage it, the better off we will all be.  My strategy will be to continue to accumulate knowledge and leverage it to the greatest extent to solve our problems.

In that context I continue to invest substantial amounts of my own time making financial information accessible – meaning not just available, but simple to understand – for as many people as possible.  That is why this blog exists.  That is why I created the Financial Transparency Series and many other tools and reports available both on this blog and on the district’s web site.

Last night I delivered the presentation below to introduce the 2010-11 Budget Development Process, but more importantly the economic backdrop to that process.  It represents an abstract of the entire Financial Transparency Series.  I welcome your questions and feedback – so much so that I announced last night I will make myself available to present to any group across the district that has an interest in the finances of the Grosse Pointe Public School System.  So if you are a part of a PTO, athletic or performing arts booster group, or any other community group please take me up on my offer. I will be there.

The actual Resolution codifying the 2010-11 Budget Development Parameters can be found here.

I am a great fan of the Citizens Research Council of Michigan, a non-partisan policy think-tank specializing in Michigan governmental affairs.  Their motto is “The right to criticize government is also an obligation to know what you are talking about.”  I take that to heart and hope everyone else does as well.  So please consume these materials so you can contribute constructively to the solutions we need.

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Filed under Current Events, GPPS Budget Decisions, GPPS Finances

School Employee Retirement Costs and the House of the Rising Sun

Most people know by now that Lansing is by far the most significant source of school district funding.  Lansing is also the unilateral source of our second largest expense – employee retirement costs.  Lansing sets the rates and we pay the bill – a financially lethal combination that puts local school boards in an unenviable predicament.

Last Monday, January 11th, the Grosse Pointe Public Schools Board of Education had a marathon budget planning Work Session that could best be described as miserable.  My personal projection is that we will unfortunately have to terminate the employment of over 60 district employees – all of them good people who add value to our mission and who are valued in return.  But we cannot ignore our economic reality.  The cuts are coming – hard and fast.

graphWe collectively stare down the barrel of our most daunting projected budget shortfall in the history of the district, brought about equally by Lansing’s wretched policy making combined with a Depression-level state economy.

I cannot repeat enough that Lansing is the largest source of funding for every public school system in the state of Michigan.  Lansing controls our per pupil revenue.  Lansing has cut our per pupil revenue this year resulting in the loss of $3,000,000 and is making plans now for cuts next year that will result in the loss of another $2,200,000.  Meanwhile salaries and health care costs rise and student population is shrinking.  This is the financial stew that is our sustenance.

The focus in this post is another ever increasing cost which, after salary, is our second largest expense – employee retiree health and pension costs – referred to as the Michigan Public School Retirement Systems, MPSERS.  Lansing unilaterally controls the rate of this expense.  To put this in perspective, if we receive roughly $10,000 per pupil for school funding, nearly $1,300 of it goes to employee retirement.

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Filed under Current Events, GPPS Budget Decisions, State of Michigan Finances

Steps, Lanes and More: A Technical Analysis of Teacher Compensation

State of Michigan statistics show Grosse Pointe Public School teachers are the highest paid in the state.  Questions have been asked and theories presented as to why this is the case.  Teacher salaries are every district’s highest investment.  As such we need to understand the dynamics of employee compensation fully, but undertake the analysis in an objective, constructive manner.

Teacher salaries.  This is a heavy topic.  So here’s the preamble.

You are NOT about to read an argument that makes a case that our teachers are overpaid, or that they are greedy, or that they are to blame for school districts’ financial predicament, or that unions are evil, or any other similarly negative interpretation of this analysis.  We have to be able to talk about compensation.  We cannot fearfully avoid these discussions.  This would be like a household under financial distress avoiding discussion about their mortgage as they plan their budget.

The fact is that teacher salaries are our highest investment.  This should come as a surprise to no one.  Furthermore, salary costs have a direct impact on our second highest expense, retirement costs.  When dealing with financial challenges such as we are today it would be simply foolish to avoid analysis of our two largest budget items.

In anticipation of the next logical question, how can I, as a member of the Board of Education, position myself as an objective analyst?   I myself am a graduate of the Grosse Pointe Public School System (South, ’86).  I remain in frequent contact with dozens of fellow GPPSS graduates who are eager to see the district flourish.  As a parent of three GPPSS students, an uncle to many more students, and friend or neighbor of the parents of scores more students, I want nothing but the best for our district.  These are my motivations for Board service.

I count many teachers as friends.  Many recall I, too, was once a teacher and know how familiar I am with the value they deliver, their motivation for their profession, and unique challenges of their jobs.  I recognize the importance of a mutually respectful and beneficial partnership.

I don’t buy into the idea that Board members and teachers have to be cats and dogs.  I have nothing to personally gain in the increase or decrease of employee compensation.  I believe, as I am sure our employees believe, that the Grosse Pointe Public School System must maintain financial equilibrium in order to deliver the services the community expects.  As a Board member, my responsibility is to help ensure short-term AND long-term financial equilibrium within the construct of how Michigan funds public schools.  So with that foundation, let’s get started.

In a recent post and in a variety of benchmarking reports I have pointed out the implications of employee compensation on school budgets.  This begs the question, if it is true that Grosse Pointe Public School teachers are the highest paid in the state, how did it come to be that way and how can we afford it?  One hypothesis is that our teacher salaries are higher because we have a more experienced staff (in terms of years of service) and better educated teachers (measured by degrees and post-graduate credits).

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Filed under Dispelling Rumors, GPPS Budget Decisions, GPPS Finances